Auditors are gate-keepers of financial integrity. In Singapore, the Companies Act treats their appointment with the same seriousness as the appointment of a director — and the consequences of missing the statutory deadlines fall squarely on the board. If your company does not qualify for audit exemption, Section 205 of the Companies Act sets out exactly who must appoint the auditor, when, how, and how to change one if the working relationship breaks down.
This 2026 guide walks directors and company secretaries through the full lifecycle: first appointment after incorporation, annual re-appointment at the AGM, casual vacancies, removal, and the disclosure obligations that sit alongside every appointment. We also cover the practical considerations — picking a Public Accountant, the engagement letter, fee setting, and what to do when the auditor resigns mid-year.
What Section 205 of the Companies Act Requires
Section 205 of the Companies Act 1967 obliges every Singapore-incorporated company — public or private — to appoint at least one auditor unless the company qualifies for audit exemption under the small-company regime. The auditor must be a Public Accountant registered with the Accounting and Corporate Regulatory Authority (ACRA) under the Accountants Act 2004, or a registered audit firm.
The key timelines are simple but easy to miss:
- First appointment: within three months of incorporation, made by the directors.
- Subsequent annual appointment: at each Annual General Meeting (AGM), by the members.
- Casual vacancy: filled by the directors within a reasonable period.
- Term: the auditor holds office until the conclusion of the next AGM.
Companies that have dispensed with AGMs (a common move for private companies) still need to follow the same logic — annual re-appointment is built into the regime, and skipping it can leave the company without a properly appointed auditor for the financial year.
First Appointment: The Three-Month Window
The directors of a newly incorporated Singapore company have three months from the date of incorporation to appoint the first auditor. This is the most commonly missed step, especially for founders who incorporate and then focus on operations without addressing the statutory checklist.
Who makes the decision?
The directors — by board resolution. Members do not need to be involved at this stage. The board resolution should record:
- The name and ACRA registration number of the Public Accountant or audit firm;
- Their written consent to act (Section 205(8));
- The financial year for which they are appointed; and
- The fee or the mechanism for determining the fee.
What if you miss the three months?
If the directors fail to appoint an auditor within the statutory window, ACRA may, on application by any member, appoint one — and bill the company. More importantly, the directors commit an offence under Section 205(11) and can be fined. The fix is straightforward: appoint immediately and document the resolution. Some auditors will require a “catch-up” letter explaining the gap.
Annual Appointment at the AGM
At each AGM, the members re-appoint the auditor by ordinary resolution. The retiring auditor is normally re-appointed automatically unless:
- The auditor has indicated unwillingness to be re-appointed;
- A resolution has been passed appointing a different auditor; or
- The auditor has become disqualified (for example, by becoming an officer or employee of the company).
For companies that have dispensed with AGMs under Section 175A, the re-appointment must still be made — typically by written resolution circulated to the members within the time the AGM would otherwise have been held.
Eligibility: Who Can Be Appointed?
The Companies Act and the Accountants Act together restrict eligibility to:
- An individual Public Accountant registered with ACRA;
- A firm in which all partners are Public Accountants; or
- A Limited Liability Partnership (LLP) registered as a Public Accounting Firm under the Accountants Act.
Disqualifications under Section 10 of the Companies Act include any person who is:
- An officer of the company (director, secretary, or auditor of another company in the same group);
- An employee of an officer of the company;
- A partner or employee of an officer; or
- Indebted to the company or its related corporations for more than S$2,500.
Independence rules in the Singapore Code of Professional Conduct go further, addressing self-review and self-interest threats. A good Public Accountant will run an independence check before signing the engagement letter — directors should expect this and not be offended by it.
Documents Required for Appointment
The corporate secretary should compile the following on file:
- Directors’ resolution (first appointment) or members’ resolution (annual / replacement);
- Letter of consent from the auditor under Section 205(8);
- Engagement letter signed by both parties;
- Notification to ACRA via BizFile within 14 days using the “Appointment of Auditor” transaction; and
- Update to the statutory registers — specifically the register of auditors maintained by the secretary.
The engagement letter is more than a formality. It sets the scope, the fee, the timeline, and the responsibilities of management (including the directors’ confirmation that the financial statements give a true and fair view). It also typically deals with limitation of liability, although Singapore law restricts how far an auditor can contract out of liability for professional negligence.
Removal, Resignation, and Casual Vacancies
Removal by members
An auditor can only be removed before the end of their term by an ordinary resolution of the members at a general meeting called specifically for the purpose. Special notice of at least 28 days must be given to the company under Section 205(5). The company must then forward the notice to the auditor, who has the right to make written representations to the members.
This is a deliberately high-friction process. The legislature wanted removal of an auditor mid-term to be public, deliberate, and accompanied by the auditor’s side of the story. If the dispute is over the audit opinion, removing the auditor will not change the underlying issue — and prospective replacement auditors will ask sharp questions about why the previous auditor was removed.
Resignation by the auditor
An auditor may resign by giving written notice to the company. If the company has filed its financial statements for the year in question, the resignation takes effect on the date specified in the notice. The auditor must also send a copy of the resignation notice to ACRA. If there are circumstances connected with the resignation that the auditor considers should be brought to the members’ or creditors’ attention, the auditor must say so in the notice — this is the “tell-them-why-I’m-leaving” provision.
Casual vacancies
If the auditor dies, resigns, or becomes disqualified between AGMs, the directors may appoint a replacement to fill the vacancy. The new appointment lasts until the next AGM, at which the members can re-appoint or appoint someone else.
Fees and Remuneration
Section 205 allows the directors to fix the auditor’s remuneration for the first appointment. Thereafter, the members fix it at the AGM, although in practice this is usually delegated back to the directors via an ordinary resolution. The total remuneration paid to the auditor must be disclosed in the financial statements, broken out between audit and non-audit services.
For small to mid-sized private companies, audit fees in Singapore typically range from S$3,000 to S$15,000 depending on complexity, turnover, group structure, and whether consolidation is required. Fees outside this range — particularly very low quotes — should raise questions about the quality of the work and the independence of the firm.
The Audit Exemption Alternative
Not every company needs an auditor. Under the small-company regime introduced in 2015, a private company is exempt from audit if it meets at least two of the three criteria:
- Total annual revenue not exceeding S$10 million;
- Total assets not exceeding S$10 million; and
- Number of employees not exceeding 50.
The criteria must be met in the two immediately preceding financial years. For companies in a group, the small-group test applies on a consolidated basis. We cover the mechanics in detail in our Audit Exemption Singapore 2026 guide.
Director Liability and the Audit File
Appointing an auditor does not transfer the directors’ responsibility for the financial statements. Under Section 201 of the Companies Act, directors retain primary responsibility for ensuring the financial statements give a true and fair view. The auditor’s role is to form an independent opinion — not to prepare the books.
In practice, directors should:
- Sign management representation letters with care, after reading them;
- Respond to audit queries promptly and completely;
- Discuss any modified audit opinion at board level and minute the discussion; and
- Take qualified opinions seriously — they often signal accounting irregularities that may have downstream tax, banking, or shareholder consequences.
If you are dealing with a difficult audit, see our guide on director personal liability for non-compliance.
Practical Checklist for the First Appointment
- ☐ Confirm whether the company qualifies for audit exemption.
- ☐ If not, identify a Public Accountant or audit firm (check ACRA’s Public Accountant register).
- ☐ Obtain a written consent to act under Section 205(8).
- ☐ Pass a board resolution appointing the auditor.
- ☐ Sign the engagement letter.
- ☐ File the appointment via ACRA BizFile within 14 days.
- ☐ Update the statutory register of auditors.
- ☐ Diarise the next AGM date for re-appointment.
Final Thoughts
The appointment of an auditor is one of the most under-rated milestones in the corporate life cycle. Get it right at incorporation and the company starts on a footing of clean compliance. Miss the deadline or appoint someone unsuitable, and the cost of catching up — both in penalties and in the auditor’s catch-up fees — is rarely worth the saving.
If you are unsure whether your company is audit-exempt, or you need help selecting a Public Accountant and coordinating the appointment paperwork, Raffles Corporate Services handles the full cycle: secretarial filings, ACRA notifications, and liaison with the audit team.
— The Editorial Team, Raffles Corporate Services